Milo Vs Ovaltine Case Summary

“Choquik: A Quickly Chocolaty Death”

Given the same product quality, i.e. the same taste, texture, color, and smell, consumers will generally prefer cheaper brands, right? If the market perceives powdered chocolate drinks as commodities, then this is true for Milo, Ovaltine and Choquik. Pricing strategies and price wars will kick in, and the cheapest brand may get the bigger market share. This is not the case. The market considers Milo and Ovaltine as two distinct brands. Some consumers claim that Ovaltine tastes best, while some claim that the brand pales in comparison to Milo. The market talks about Milo vs. Ovaltine, like Black vs. White, two parties that vie for the biggest market share.

Where then is Choquik in the picture?
Intuitively, a better product should translate to a better performance, but the market today says “not necessarily”. Consider the following data:
• In a forum discussion on Milo vs. Ovaltine, users were divided as to what taste best. (www.sulit.com.ph)
• In a forum discussion on Milo vs. Choquik, users almost unanimously voted for Milo. (www.totalgirl.com.ph)
Why did users vote for Milo? Interestingly, there were those who say that Choquik, contrary to the forum post above, tastes like sugar instead of cocoa. Judging from the general disposition of the voters, their perceived quality of Milo as against Choquik may be distorted by their biases.
Most forum posters, however, prefer Milo because they have NEVER tried Choquik before.

Consumers are not TRYING out their product

The brand may be sweeter and tastier than Milo, or even against Ovaltine, but consumers will never know unless they try it out. This is entirely different from capturing repeat buyers. Even if Choquik succeeds in making consumers try their product, biases may distort how buyers taste
From the time it entered the market, and even until now, Choquik is seen as the trying-hard-Milo-imitation. It has to separate itself from the Milo-mentality of consumers and repackage the brand as a non-Milo product or it will inevitably suffer from negative comparisons to its competitors.
Through giving the consumers a message distinct from Milo and Ovaltine, consumers may find a reason why they should buy Choquik. Their product quality and quality efforts to provide the consumers with the best chocolate drinks are put to waste without a proper market. As one professor in CBA always says, everything is market-driven.
More than the taste, consumers are looking for certain belongingness in buying such products. Currently, customers either belong to the Milo group or the Ovaltine group. They get additional value from the product by providing them social acceptance and by feeding their ego because they drink the most popular brand in the market.
To do this, Choquik also needs to break free from the “commodity trap”. Currently, the pricing strategy of Choquik is to under price both leading brands. Customers find value in cheap products, but only in terms of monetary savings, and even then they only save Php 3.00 per 300grams of Choquik when they choose to forego buying